§ 24.401 Replacement housing payment for 90-day homeowner-occupants. ( a ) *Eligibility.* A displaced person is eligible for the replacement housing payment for a 90-day homeowner-occupant if the person: ( 1 ) Has actually owned and occupied the displacement dwelling for not less than 90 days immediately prior to the initiation of negotiations; and
( 2 ) Purchases and occupies a decent, safe, and sanitary replacement dwelling within 1 year after the later of the following dates (except that the agency may extend such 1 year period for good cause): ( i ) The date the displaced person receives final payment for the displacement dwelling or, in the case of condemnation, the date the full amount of the estimate of just compensation is deposited in the court; or
( ii ) The date the agency's obligation under § 24.204 is met.
( b ) *Amount of payment.* The replacement housing payment for an eligible 90-day homeowner-occupant may not exceed $41,200 (*see also* § 24.404). The payment under this subpart is limited to the amount necessary to relocate to a comparable replacement dwelling within 1 year from the date the displaced homeowner-occupant is paid for the displacement dwelling, or the date a comparable replacement dwelling is made available to such person, whichever is later. The payment shall be the sum of: ( 1 ) The amount by which the cost of a replacement dwelling exceeds the acquisition cost of the displacement dwelling, as determined in accordance with paragraph (c) of this section;
( 2 ) The increased interest costs and other debt service costs which are incurred in connection with the mortgage(s) on the replacement dwelling, as determined in accordance with paragraph (d) or (e) of this section, as applicable; and
( 3 ) The reasonable expenses incidental to the purchase of the replacement dwelling, as determined in accordance with paragraph (f) of this section.
( c ) *Price differential* — ( 1 ) *Basic computation.* The price differential to be paid under paragraph (b)(1) of this section is the amount which must be added to the acquisition cost of the displacement dwelling and site (*see* § 24.2(a)) to provide a total amount equal to the lesser of: ( i ) The reasonable cost of a comparable replacement dwelling as determined in accordance with § 24.403(a); or
( ii ) The purchase price of the DSS replacement dwelling actually purchased and occupied by the displaced person.
( 2 ) *Owner retention of displacement dwelling.* If the owner retains ownership of his or her dwelling, moves it from the displacement site, and reoccupies it on a replacement site, the purchase price of the replacement dwelling shall be the sum of: ( i ) The cost of moving and restoring the dwelling to a condition comparable to that prior to the move;
( ii ) The cost of making the unit a DSS replacement dwelling (*see* § 24.2(a));
( iii ) The current fair market value for residential use of the replacement dwelling site (*see* appendix A to this part, section 24.401(c)(2)(iii)), unless the claimant rented the displacement site and there is a reasonable opportunity for the claimant to rent a suitable replacement site; and
( iv ) The retention value of the dwelling if such retention value is reflected in the “acquisition cost” used when computing the replacement housing payment.
( d ) *Increased mortgage interest costs.* The agency shall determine the factors to be used in computing the amount to be paid to a displaced person under paragraph (b)(2) of this section. Except as otherwise provided in paragraph (e) of this section, the payment for increased mortgage interest cost shall be the amount which will reduce the mortgage balance on a new mortgage to an amount which could be amortized with the same monthly payment for principal and interest as that for the mortgage(s) on the displacement dwelling. In addition, payments shall include other debt service costs, if not paid as incidental costs, and shall be based only on bona fide mortgages that were valid liens on the displacement dwelling for at least 180 days prior to the initiation of negotiations. Paragraphs (d)(1) through (5) of this section shall apply to the computation of the increased mortgage interest costs payment, which payment shall be contingent upon a mortgage being placed on the replacement dwelling. ( 1 ) The payment shall be based on the unpaid mortgage balance(s) on the displacement dwelling; however, in the event the displaced person obtains a smaller mortgage than the mortgage balance(s) computed in the buydown determination, the payment will be prorated and reduced accordingly. (See appendix A to this part, section 24.401(d).) In the case of a home equity loan the unpaid balance shall be that balance which existed 180 days prior to the initiation of negotiations or the balance on the date of acquisition, whichever is less.
( 2 ) The payment shall be based on the remaining term of the mortgage(s) on the displacement dwelling or the term of the new mortgage, whichever is shorter.
( 3 ) The interest rate on the new mortgage used in determining the amount of the payment shall not exceed the prevailing fixed interest rate for conventional mortgages currently charged by mortgage lending institutions in the area in which the replacement dwelling is located.
( 4 ) Purchaser's points and loan origination or assumption fees, but not seller's points, shall be paid to the extent: ( i ) They are not paid as incidental expenses;
( ii ) They do not exceed rates normal to similar real estate transactions in the area;
( iii ) The agency determines them to be necessary; and
( iv ) The computation of such points and fees shall be based on the unpaid mortgage balance on the displacement dwelling, less the amount determined for the reduction of the mortgage balance under this section.
( 5 ) The displaced person shall be advised of the approximate amount of this payment and the conditions that must be met to receive the payment as soon as the facts relative to the person's current mortgage(s) are known and the payment shall be made available at or near the time of closing on the replacement dwelling in order to reduce the new mortgage as intended.
( e ) *Reverse mortgages.* The payment for replacing a reverse mortgage shall be the difference between the existing reverse mortgage balance and the minimum dollar amount necessary to purchase a replacement reverse mortgage which will provide the same or similar terms as that for the reverse mortgage on the displacement dwelling. In addition, payments shall include other debt service costs, if not paid as incidental costs, and shall be based only on reverse mortgages that were valid liens on the displacement dwelling for at least 180 days prior to the initiation of negotiations. Paragraphs (e)(1) through (4) of this section shall apply to the computation of the mortgage interest differential payment required under paragraph (d) of this section, which payment shall be contingent upon a new reverse mortgage being purchased for the replacement dwelling. ( 1 ) The payment shall be based on the difference between the reverse mortgage balance and the minimum amount needed to qualify for a reverse mortgage with the similar terms as the reverse mortgage on the displacement dwelling; however, in the event the displaced person obtains a reverse mortgage with a smaller principal balance than the reverse mortgage balance(s) computed in the buydown determination, the payment will be prorated and reduced accordingly. (*See* appendix A to this part, section 24.401(e).) The reverse mortgage balance shall be that balance which existed 180 days prior to the initiation of negotiations or the reverse mortgage balance on the date of acquisition, whichever is less.
( 2 ) The interest rate on the new reverse mortgage used in determining the amount of the eligibility shall not exceed the prevailing rate for reverse mortgages currently charged by mortgage lending institutions for owners with similar amounts of equity in their units in the area in which the replacement dwelling is located.
( 3 ) Purchaser's points and loan origination, but not seller's points, shall be paid to the extent: ( i ) They are not paid as incidental expenses;
( ii ) They do not exceed rates normal to similar real estate transactions in the area;
( iii ) The agency determines them to be necessary; and
( iv ) The computation of such points and fees shall be based on the reverse mortgage balance on the displacement dwelling plus any amount necessary to purchase the new reverse mortgage.
( 4 ) The displaced person or their representative shall be advised of the approximate amount of this eligibility and the conditions that must be met to receive the reimbursement as soon as the facts relative to the person's current reverse mortgage are known; the payment shall be made available at or near the time of closing on the replacement dwelling in order to purchase the new reverse mortgage as intended.
( f ) *Incidental expenses.* The incidental expenses to be paid under paragraph (b)(3) of this section or § 24.402(c)(1) are those necessary and reasonable costs actually incurred by the displaced person incident to the purchase of a replacement dwelling, and customarily paid by the buyer, including: ( 1 ) Legal, closing, and related costs, including those for title search, preparing conveyance instruments, notary fees, preparing surveys and plats, and recording fees.
( 2 ) Lender, FHA, or VA application and appraisal fees.
( 3 ) Loan origination or assumption fees that do not represent prepaid interest.
( 4 ) Professional home inspection, certification of structural soundness, and termite inspection.
( 5 ) Credit report.
( 6 ) Owner's and mortgagee's evidence of title, *e.g.,* title insurance, not to exceed the costs for a comparable replacement dwelling.
( 7 ) Escrow agent's fee.
( 8 ) State revenue or documentary stamps, sales, or transfer taxes (not to exceed the costs for a comparable replacement dwelling).
( 9 ) Such other costs as the agency determines to be incidental to the purchase.
( g ) *Rental assistance payment for 90-day homeowner.* A 90-day homeowner-occupant, who could be eligible for a replacement housing payment under paragraph (a) of this section but elects to rent a replacement dwelling, is eligible for a rental assistance payment. The amount of the rental assistance payment is based on a determination of market rent for the acquired dwelling compared to a comparable rental dwelling available on the market. The difference, if any, is computed in accordance with § 24.402(b)(1), except that the limit of $9,570 does not apply, and is disbursed in accordance with § 24.402(b)(3). Under no circumstances would the rental assistance payment exceed the amount that could have been received under paragraph (b)(1) of this section had the 90-day homeowner elected to purchase and occupy a comparable replacement dwelling. Payments allowed under § 24.402(c) are not applicable.